Out of the cold? Helping people on prepayment meters stay connected this winter
The Government has recently announced an Energy Price Guarantee to help households with rising energy costs. The Guarantee caps how much customers can be charged per unit of electricity, meaning households will pay an average of £2,500 a year for their energy bill.
Despite this welcome support, bills will still be twice what they were last winter, and higher users, like some disabled people, will pay even more.1 Millions of households are already in arrears and many more will fall behind on their energy bills this winter.
When customers struggle with their payments, energy suppliers are required to support them. This usually takes the form of a repayment plan, agreed between the supplier and the customer. However, as financial pressures grow, many are struggling to meet their ongoing usage, let alone payments towards arrears.
This is leading to an escalation of debt collection activity, with suppliers increasingly forcing customers onto prepayment meters so that they stop building up debt and so the supplier can collect a part of the debt every time someone tops up.
This is extremely risky for customers; if a customer who is struggling to pay is put onto a prepayment meter, then they may not have enough money to top up their meter and their power will be disconnected. This is called self-disconnection. We’re calling on the Government to stop forcing energy customers onto prepayment meters to recover debt, so that we can keep more people on supply this winter.
Specifically, we want to see a winter moratorium on moving customers to prepayment meters under warrant and on switching smart meters to prepay in an attempt to recover debt. This moratorium should remain in place until April 2023.
This report brings to light the reality of being moved to a prepayment meter when you can’t afford to pay, and what suppliers and the Government can do to help.